Partners Bet on Microsoft Tablet

By Colin C. Haley

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Microsoft isn't the only tech company rooting for a successful debut of the Tablet PC next month.

A host of vendors, from chip producer Transmeta to computer maker Acer to software developer ScanSoft are hopeful the sleek platform can jump-start the stalled PC market.

About the size of a legal pad, and based on the Windows XP Professional operating system, the Tablet PC allows users to input and retrieve data by keyboard, stylus, or voice commands.

It is equipped with a built-in 802.11 WiFi (wireless ethernet) connection, a key selling point for several of Microsoft's target markets.

For example, the Redmond, Wash., giant envisions doctors, nurses and administrators entering patient information directly into tablets, saving time and trimming paperwork. Other industries to be pitched include government and financial services.

"The Tablet PC is the right product at the right time," said Robert Weideman, chief marketing officer at ScanSoft, a Peabody, Mass., company that is extending its relationship with Microsoft to include Tablet PC software.

ScanSoft applications will help Tablet users fill forms (by voice or in their own handwriting) and organize hand-written notes in the Microsoft Windows Journal utility.

In addition, Scansoft will allow developers to add speaker-independent and "microphone-free" voice command capabilities to their applications as well as text-to-speech functions.

ScanSoft is well-positioned thanks to two adept acquisitions. A year ago, it bought the core technology of bankrupt and disgraced Lernout & Hauspie at auction.

The deal included L&H's text-to-speech technologies, including RealSpeak, and automatic speech recognition technologies, such as the Dragon Naturally Speaking. And just this week, it enhanced that portfolio by buying Philips Electronics' speech unit for $35.4 million.

Richard Mack, a ScanSoft spokesman, acknowledged that the PC market is hurting, but maintained that Tablet PCs will gain acceptance as more applications are developed for it and users become comfortable with using a stylus.

"It's an entirely new platform and with so many people working on it, I think it will do well," Mack said.

Ken Dulaney, a vice president with IT research firm Gartner Group who has tested the technology, gives it somewhat mixed reviews.

For several markets, including health care and insurance, which are using earlier iterations of the operating system (Microsoft has been working for nearly a decade on the technology), the new release is a marked improvement.

Dulaney is less sanguine however about the mainstream adoption. For starters, Microsoft needs to improve the flow between Journal and Office programs. In addition, it must refine the physical design, such as fix balky hinges, with manufacturers.

"We think (the launch) won't be as bad as the press says, but certainly not as good as Microsoft hopes," Dulaney concluded.